In fairness to born-again boss Jack Dorsey, he hasn’t shied away from taking tough decisions and has been very much tuned into Twitter users’ gripes (of which there have been many). But his return to the role of CEO hasn't yet turned around the firm's fortunes.
His big challenge was re-energising Twitter’s slowing growth in monthly active users, and that's really not going too well. The service’s user base is up 9% year over year, but against the past quarter growth has stopped and numbers are flat lining at 320m. A historical moment for the company but probably not one it wants to remember – it’s the first quarter in which the number of monthly active users hasn’t grown.
If SMS Fast Followers – those who use the service via messaging platforms – are discounted, Twitter’s user base actually declined, down from 307m to 305m in the three months up to 31 December.
The news has investors' feathers well and truly ruffled. Twitter’s share price fell 13% in after hours trading, though it later rallied to a 3% loss. If you ignore the looming elephant in the room, the financial picture was otherwise fairly decent. Revenue rose 48% to $710m (£492m) compared to the fourth quarter of 2014, matching analysts’ expectations. It reported a net loss of $90m – compared to one of $125m a year ago. But really, it’s hard to see past the fact Twitter’s share price is down some 70% on where it was a year ago.
Obviously anticipating the unimpressed response from shareholders, Twitter tried to provide reassurance in a letter, claiming the fall-off would merely be temporary. ‘As of the end of January, we have already seen total MAUs, excluding SMS Fast Followers, return to Q3 levels,’ execs said. Dorsey also thought it worth pointing out that the users lost ‘were not high quality’ – though he might not want to be too selective at the moment, Twitter needs all the help it can get...
He's also battling with stubborn users as it is, already sensitive to experimental changes to the platform. Its Moments feature has gone down like a lead balloon – despite shelling out pricey TV ads for the addition hoping to convey Twitter’s mainstream appeal. Its next big change; the move towards an algorithmically sorted (rather than chronological) timeline, was being torn to pieces by users before it was even unveiled (a quick look at the RIP Twitter hashtag provides a common sentiment).
Drastic changes, much more substantial than the timeline twiddling, need to be rolled out to try and bring back the masses who might have initially given Twitter a whirl but ditched it in the early days. But its already rather vocal users could start leaving in droves if they aren’t changes that also sit well with them.
Of course there’s also the option of trying to draw more money from its existing, fairly loyal user base. Which could be through, you guessed it, even more ads. Not much to chirp about.